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REPORT 


OF  THE 


COMMISSION 


ON  THE 


REVENUE  OF  THE  STATE. 


SEPTEMBER,  1896, 


PROVIDENCE: 

E.  L.  FREEMAN  &  SONS,  PRINTERS  TO  THE  STATE. 

1896. 


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REPORT 


OF  THE 


COMMISSION 


ON  THE 

'REVENUE  OF  THE  STATE. 


SEPTEMBER,  1896. 


PEOVIDENCE: 

E.  L.  FREEMAN  &  SONS,  PRINTERS  TO  THE  STATE. 

1896. 


REPORT. 


To  the  Honorable  the  General  Assembly  of  the  State  of  Rhode 

Island ,  etc. 

On  the  9th  day  of  April  last  a  resolution  was  passed  by  the 
General  Assembly  creating  a  Joint  Special  Commission,  and 
their  duties  were  defined  as  follows  :  —  they  “  shall  take  into 
consideration  and  report  upon  the  probable  extraordinary  ex¬ 
penditures  of  the  State  within  the  next  five  years,  for  public 
buildings,  and  such  other  public  works  as  are  now  in  pro¬ 
cess  of  construction,  or  contemplated,  and  also  to  report,  by 
hill  or  otherwise,  some  plan  for  such  an  increase  of  the  rev¬ 
enue  of  the  State  as  shall  provide  for  such  expenditures,  and 
also  for  the  payment  of  interest  on  the  bonds  of  the  State,  to 
be  issued  in  payment  therefor  in  case  it  is  found  necessary  to 
provide  for  an  issue  of  bonds.” 

As  soon  after  the  appointment  of  the  Commission  as  possi¬ 
ble,  the  members  were  called  together  and  the  Commission 
was  organized  by  choosing  E.  L.  Freeman  as  chairman,  and 
Eugene  F.  Warner,  clerk. 

It  will  be  seen  that  the  subject  referred  to  this  Commission 
is  one  of  vast  importance,  requiring  not  only  an  exhaustive 
examination  into  the  present  sources  and  amount  of  the  rev¬ 
enue  of  the  State  and  its  present  financial  condition,  but  also 
a  forecast,  so  far  as  may  be  possible,  for  five  years  in  the 
future. 

In  accordance  with  the  resolution  the  clerk  was  directed  to 
address  the  several  boards  and  departments  of  the  State  that 


\ 


4 


KEPOET  OF  COMMISSION  ON  EEVENUE  OF  THE  STATE. 


are  building  or  contemplating  the  building  of  public  works, 
and  ascertain  what  their  expenditures  would  probably  be,  but 
thus  far  only  one  answer  has  been  received. 

The  resolution  provided  that  this  Commission  should  report 
at  the  next  January  session  of  the  Assembly,  but  as  the 
financial  condition  of  the  State  requires  that  some  action 
should  be  taken  at  this  session  of  the  Assembly,  we  have 
thought  it  best  to  present  a  report  upon  that  part  of  the  sub¬ 
ject,  with  our  recommendation  as  to  what  we  consider  to  be 
the  most  expedient  plan  for  relieving  the  treasury. 

As  far  as  can  be  ascertained  from  the  books  of  the  State 
auditor  and  general  treasurer,  taking  the  actual  receipts  and 
expenditures  for  the  eight  months  to  September  1st,  and  the 
estimated  revenue  and  expenditures  for  the  four  remaining 
months,  there  will  be,  December  31st,  if  no  special  appropria¬ 
tions  are  made  at  this  session,  and  if  the  balance  of  interest 
accrued  on  State  House  Bonds  is  turned  into  the  general 
fund  of  the  State,  a  deficiency  of  not  far  from  $90,000.00, 
or  about  the  same  deficiency  that  existed  at  the  beginning 
of  the  year  ;  showing  that  the  receipts  for  the  present  year 
have  been  about  equal  to  the  expenditures,  notwithstanding 
that  large  sums  have  been  paid  during  that  time  on  account 
of  special  appropriations. 

There  are  certain  special  appropriations,  however,  that  will 
be  asked  for  at  this  session,  some  of  which  should  undoubt¬ 
edly  be  granted.  The  wisdom  of  making  some  of  them  in 
the  present  condition  of  the  treasury,  is  a  matter  for  the 
General  Assembly  to  determine  after  careful  consideration. 

At  the  beginning  of  the  year  1895,  there  was  a  balance  in 
the  treasury  of  $240,630.99.  During  that  year  this  balance 
was  used  up  and  the  State  was  in  debt  $90,761.75. 

The  question  naturally  arises,  what  was  the  reason  for 


REPORT  OF  COMMISSION  ON  REVENUE  OF  THE  STATE. 


b 


such  a  heavy  expenditure  ;  the  question  is  a  perfectly  proper 
one  for  the  taxpayers  of  the  State  to  ask  of  their  representa¬ 
tives,  and  can  be  answered  very  easily. 

Within  the  last  five  years,  and  largely  within  the  years 
1895  and  1896,  the  following  special  appropriations  made  by 
the  General  Assembly  during  those  two  and  previous  years 
have  been  provided  for  :  — 

Three  new  armories  have  been  built,  at  Pawtucket,  at 
Newport,  and  at  Bristol,  and  three  others  have  been  repaired, 
etc. 

Two  new  court  houses  have  been  erected,  at  Woonsocket 
and  at  Kingston. 

The  land  has  been  purchased  and  a  new  building  is  in 
process  of  erection  for  the  State  normal  school. 

A  breach  way  has  been  constructed  at  Block  Island. 

Buildings  have  been  erected  for  the  Rhode  Island  Institute 
for  the  Deaf. 

New  buildings  have  been  erected  for  the  R.  I.  College  of 
Agriculture. 

The  claims  of  Brown  University  against  the  State  on  ac¬ 
count  of  agricultural  fund  have  been  settled. 

The  Red  Bridge  across  the  Seekonk  river  has  been  re-built. 

A  camp-ground  for  the  State  Militia  has  been  purchased 
and  buildings  erected. 

The  taking  of  the  census  of  the  State  has  been  in  progress. 

New  buildings  have  been  erected  for  the  Sockanosset 
School  and  for  the  State  Home  and  School. 

Besides  these  many  other  special  appropriations  of  varying 
amounts  have  been  made.  A  detailed  list  of  the  principal 
amounts  expended  is  as  follows  :  — 


Armories  and  camp-grounds . $292,581  83 

New  court-houses . .  79,261  62 


b  REPORT  OF  COMMISSION  ON  REVENUE  OF  THE  STATE. 


New  Normal  School  Building .  296,664  14 

Institute  for  the  Deaf,  buildings,  etc .  68,980  28 

Plans  and  expenses  of  new  State  House  pre¬ 
vious  to  the  issue  of  bonds .  14,342  22 

Revising  and  publishing  General  Laws .  54,797  71 

New  buildings  at  Soldiers’  Home .  11,973  66 

Taking  the  census  of  the  State .  43,479  98 

State  Home  and  School  dormitory .  7,766  36 

Making  new  experimental  roads .  15,741  55 

Breachway  at  Block  Island .  54,863  26 

Rebuilding  the  Red  Bridge .  40,000  00 

Settling  claims  of  Brown  University .  40,000  00 

Addition  to  Providence  County  jail .  8,091  29 

4 

Dormitories,  etc.,  at  Agricultural  College .  53,160  00 

New  buildings  at  Sockanosset  School .  7,857  62 

Expenses  in  connection  with  Colombian  Ex¬ 
position  .  45,451  43 


These  expenditures  amount  to  $1,135,012.95  ;  besides  these 
there  have  been  special  appropriations  amounting  in  the 
aggregate  to  quite  a  considerable  sum,  which  must  be  classed 
as  extraordinary. 

In  addition  to  these  large  expenditures,  there  has  been 
paid  during  the  years  1892,  1893,  and  1894,  into  the  sinking 
fund  for  the  redemption  of  the  war  bonds  of  the  State  the 
sum  of  $150,000,  and  as  interest  on  these  bonds  a  further 
sum  of  $196,560.  These  sums  added  to  the  amounts  paid 
on  special  appropriations  as  above,  bring  the  sum  total  up 
to  $1,481,572,95.  It  certainly  speaks  volumes  for  the  finan¬ 
cial  ability  of  our  State,  that  it  has  been  able  in  the  last 
four  years  to  pay,  outside  of  its  regular  expenditures,  nearly 
one  and  one-ha]  f  millions  of  dollars,  and  yet  he  in  debt  less 
than  $100,000.00. 


REPORT  OF  COMMISSION  ON  REVENUE  OF  THE  STATE. 


7 


It  will  be  seen  that  these  extra  expenditures  have  not  been 
confined  to  any  one  locality  of  the  State,  or  to  any  one  depart¬ 
ment.  The  military,  the  educational,  the  judicial,  the  agri¬ 
cultural,  and  the  commercial  interests  of  the  State  have 
shared  in  these  extraordinary  expenditures.  Furthermore, 
we  believe  that  the  money  has  been  honestly  expended,  and 
for  objects  required  or  demanded  by  the  people. 

Your  Commission  would  recommend  the  adoption  of  the 
following  resolution,  or  something  of  the  same  nature  : 

Resolved ,  That  the  following  question  be  submitted  to  the 
voters  of  the  State  to  be  voted  upon  at  the  election  to  be  held 
on  the  first  Tuesday  after  the  first  Monday  in  November 
next,  viz  : 

4  4  Shall  the  General  Assembly  be  authorized  to  provide 
for  borrowing  from  time  to  time  such  sums  of  money  as 
may  be  necessary  to  pay  the  authorized  expenditures  of  the 
State,  not  to  exceed  at  anyone  time  the  amount  of  ($250,000) 
two  hundred  and  fifty  thousand  dollars  ?  ” 

Under  the  system  practised  for  many  years,  of  the  Gen¬ 
eral  Treasurer  being  allowed  to  overdraw  his  account  at 
bank,  no  legislation  would  be  required  upon  this  subject. 
But  as  the  Governor  of  the  State  has  pronounced  such 
methods  to  be  un-business-like,  irregular,  and  in  his  opinion, 
unconstitutional,  and  as  the  Supreme  Court  has  decided  that 
no  officer  of  the  State  has  the  right  to  contract  any  debt 
unless  authorized  to  do  so  by  law,  some  action  must  be  taken 
at  this  session  of  the  General  Assembly. 

We  prefer  this  method  of  raising  the  necessary  funds  for 
paying  the  obligations  of  the  State,  to  that  of  issuing  bonds, 
because  we  think  the  embarrassment  is  of  a  temporary 
nature  and  that  if  economy  is  used  in  the  expenditures  of 
the  State,  and  proper  discrimination  exercised  in  making 


8  REPORT  OF  COMMISSION  ON  REVENUE  OF  THE  STATE. 

special  appropriations,  the  indebtedness  can  all  be  met  and 
provided  for  within  the  next  three  years. 

We  believe  that  if  the  Treasurer  could  borrow  money  as 
it  was  needed,  and  repay  it  as  soon  as  the  taxes  and  other 
income  of  the  State  was  received,  it  would  be  more  econom¬ 
ical  than  to  issue  bonds  which  would  run  for  a  term  of  years. 

We  do  not  deem  it  expedient  to  issue  bonds  at  the  present 
time  for  the  further  reason  that  there  is  no  doubt  but  that  a 
further  and  large  issue  of  bonds  will  be  necessary  to  complete 
the  building  and  furnishing  of  the  new  State  House. 

Your  Commission  has  procured  a  large  amount  of  ma¬ 
terial  for  the  prosecution  of  the  work  committed  to  it,  and 
we  believe,  that  without  increasing  the  taxes  of  the  cities  and 
towns,  we  shall  be  able  to  present  to  the  General  Assembly' 
some  new  sources  of  revenue  which  will  materially  increase 
its  receipts,  if  your  Honorable  Body  shall  see  fit  to  enact  the 
required  legislation.  This  is  a  further  reason  why  the  plan 
of  borrowing  money  from  time  to  time  as  it  may  be  needed, 
to  be  repaid  as  fast  as  the  receipts  of  the  Treasury  will  war¬ 
rant  it,  is,  in  our  opinion,  preferable  to  the  issue  of  bonds,  at 
the  present  time. 

Respectfully  submitted, 

E.  L.  FREEMAN,  Chairman , 
BENJAMIN  DROWN,  . 
WALTER  A.  READ, 

WM.  W.  BLODGETT, 

GEORGE  BATCHELOR, 
RANDALL  A.  HARRINGTON, 
JOHN  STANTON. 


Providence,  Sept.  28,  1896. 


V 


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